BootsnAll Travel Community

What real-world effects, if any, has the falling value of the U.S. dollar had on long-term travelers?

Clearly the expensive parts of the world (Europe, Japan) are getting more expensive for U.S travelers... Are the inexpensive parts of the world getting relatively more expensive too?

And for travelers from other countries, does the U.S. look like a more affordable destination to you because of the drop in the value of the U.S. dollar?

it's great you're posing this question as i was just listening to npr while dropping off the kids and heard that as of today it takes 1.56 to buy 1 euro....YIKES! certainly does tighten the budgets of U.S. rtw travelers. i'm curious too what people, who are out there right now, traveling are finding.....how far does their dollar really go? great question....carry on

My wife and I leave for our trip in October. What was initially going to be a rtw is turning into just traveling in 2 main regions, S. America and SE Asia. It's no coincidence that we are going to two of the cheaper places to travel. We may end up working in SE Asia in order to hit another region. But Europe is definitely out because of the dollar (and we've been there before, and even though there's millions more places to see in Europe, we are holding off until later).

The £ is doing well against the $. Its currently $2.03 to £1 which will do me well when I travel in countries that take the dollar as payment. I only really hit problems when I goto Europe as 6 months ago I got €1.44 to the £ and now I'm lucky if I get €1.24 to the £.

If you live in Europe and get paid in Euro's you're laughing.

It will keep American travelers out of Europe, Europeans will travel more outside of EU and thus cause some decline in their domestic travel industry. Travel to US has increased (at least that is what San Francisco is predecting). US domestic travel will be up since its so expensive to travel aboard.

Personally I'm leaving EU out of my trip...Asia it is for now. Even there the dollar has lost its strength. Indian Rupee to dollar now is about 39Rs to a $1. Used to be around 45 about a year back.

I'm loving it at the mo being british on holiday in new york is bliss at the moment.

If you look at the value of the dollar against the countries in SEA there hasn't been much change...For the example the rupee in India has improved to about 40 to 1...the baht in thailand has remained the same over this time give or take 2-3 baht...Korean won has actually increased...the dong for vietnam is so high anyway that what is a measely 300 dong anyway that is virtually nothing...if it goes down a 1000 dong or more then we are talking.

I mean the rand in South AFrica has hovered around 8 to 1...i think the real question is if the falling dollar has effected the black market rates in these countries...can you still get things for 30 baht you got last year...or is 16000 to 1 still the rate in vietnam irrespective of the actual exchange...

I actually think the biggest place you will feel it is in cambodia where everything is priced in USD and the atms give you USD...if they change their prices based on the value of the dollar against the rest of the major currencies that could change things...

But ultimately i dont think if you are in zimbabwe where the inflation is awful that the rate is going to change on the black market...people still want good ole american greenbacks

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Originally posted by CAJ:
What real-world effects, if any, has the falling value of the U.S. dollar had on long-term travelers?

It's marvelous!

I just got 1.98 dollars for a load of pounds in London and I should get about 1.54 dollars for the euros we spend on credit cards in the us over the next 6 weeks. Even if the dollar gets weaker (which seems likely) it is still great.

It is so worth shopping around. I got 1.29 EUR/GBP cash in London versus 1.24 with my banks. And I got 1.98 USD/GBP cash versus 1.93 with banks. That was also with no commission. Reckon I saved about 4-5% altogether.

Also we ahould get great value in countries in CA/SA where dollar trading for local currency on the black market can get way over official rates - if only because we get so many dollars for our euros to start with.

Now if only the USD was stronger against the Canadian...

It's depressing. I've saved up for so long and the dollar continues to fall (understandably, but still...). I've cut out europe entirely from my RTW but Oz will eat into my budget considerably. Timing is right for this trip other than the currency exchange, and having worked in the US, I'm leaving with USD and not even the stronger CAD. Ah well - such is life. Hopefully it'll pick up again before I come back.

I'm in the same position as littletarsier. Europe is all but gone from my RTW. I only kept Greece and will get to Spain to go overland into Morocco. I felt strongly about keeping Australia and New Zealand, so Europe had to go. If we continue to see a decline, there will be more cutting. I still have about 18 months to save, but if this decline continues I'm going to probably have to chop South America as well.

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The Bretton Woods Accord, the first major economic transformation toward the end of World War II, established the International Monetary Fund (IMF) and a way to value the various currencies of the world relative to each other. All foreign currencies would trade in relationship to the US Dollar and only the US dollar (as the reserve currency) would be tied to a gold standard (meaning the value of dollars circulating must be backed by gold reserves).

So basically some countries tie their currency more strictly than others (Asian and South American particularly). Because of the dollar being weak lately, nations are slowly drifting from this, but the IMF is why you won't see much change in currencies like the baht if you're using the dollar. Some countries' currencies have been actually "Pegged" to the dollar - which is means that it is tied literally to the price of the US dollar. Hong Kong is an example.

P.S. If you really want to hate the US dollar go to one of the Scandinavian countries. It cost my $11 for a domestic beer in Copenhagen. Socialism? Um, now that I think about it - yes please.

Sorry all, but I'm in the 'sink, baby, sink' crowd. And I don't seem much reason for the dollar to rise much or soon.

In all likelihood, the Fed is gonna chop interest rates down to near Japan-like levels. Result? Weaker dollar.

The US economy is currently in a medium to heavy recession, despite the warm fuzzies from Bush&Co, and suffers from fundamental weaknesses on a scale that other world economies do not. Yes, other nations will feel pain too, but not nearly as acutely as the US. Result? Weaker dollar.

A significant trend over the past few years has been with central banks, crazy rich folks, and multinational corporations to slowly diversify their currency reserves & etc. into non-USD currencies. Long term, this is likely to continue if not accelerate. Result? Weaker dollar.

While the recent spikes in oil prices have many of my fellow Americans feeling some pain, things aren't nearly so bad elsewhere. The intrinsic value of oil remains the same, only the dollar has dropped in value. The US economy will suffer, other non-dollar based economies will not suffer. Since currency valuations are very much a reflection of the health of a nations economy, the dollar will suffer more. Result? Weaker dollar.

On that last note, there is talk of nations pricing their oil production in Euros (or whatever), which means less demand for dollars. Result? Weaker dollar.

So, in case you hadn't picked it up by now, I am a dollar sceptic. Then again, I have a mild emotional bias--It makes America cheap for me to visit, and better yet, my student loans have dropped a good 30% or so in the past few years by me not paying them off.

Last November I met up with a boot who said, with authority and emotion, that the dollar would make a come back. I saw this boot again recently, and it down right sadistic of me to bring up The Dollar again, but I did. My dear boot is still convinced of a significant USD comeback (and the demise of the Euro.) Then again, it would certainly help out the ol' travel fund, so this boot is biased too. I am not predicting a resurgent dollar, at least for the short and medium term future.

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If you really want to hate the US dollar go to one of the Scandinavian countries. It cost my $11 for a domestic beer in Copenhagen. Socialism?

Spare us the diatribe on Socialism. 'Hate the US Dollar'? What, like it is personal or something? Gawds, but whatever. Do note that, factually, A) that $11 beer was, going back historically with exchange rates, much cheaper just a few years ago when the dollar was stronger. (But, still, pretty darn expensive. But, still again, better than Sweden); B) what Danes pay in taxes there they get back in services that you can only dream of as an American. Don't knock it until you lived it.

Based on historic ups and downs, I think the dollar is currently below its long term value. So it should eventually bounce back up. But I'm not willing to make any predictions on how soon this will happen.

The thing about currencies is that they're self-correcting. Your dollar drops? Makes your country more competitive on the world market, investment flows in, currency goes up. Then it overcorrects, makes business too expensive, and goes back down. Over and over again.

I'm mostly annoyed that the CAD has recoupled with the USD, so it's been falling on world markets since November. But my next destination is Ecuador, which conveniently uses USDs, so it's 30% cheaper than a year ago. Woot!

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The thing about currencies is that they're self-correcting.

Wow, that is a bold statement. Tell that to the Italians or the Argentines.

I think, the US has to sort out some serious economic issues like debt before the dollar could potentially bounce back. If the oil seriously starts to be traded in Euro, the dollar is done for. The same thing goes with Feds investing surpluses in US bonds. If the US$ gets to scary and countries like China start putting their money in bonds in Euro or Pounds, boy oh boy. Good night US$.

Just saw that you actually get more than a Dollar for one Swiss Franc these days. Wow. I cannot remember that ever being so. Ever.

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Originally posted by elAdi:
Just saw that you actually get more than a Dollar for one Swiss Franc these days. Wow. I cannot remember that ever being so. Ever.

It never has been. Ever. Crazy, huh? When I moved to CH it was around the peak of ~1.8!

Fortunately, when we planned our RTW trip, we decided to stick with the developing world, so we're not being affected quite as much. We weren't planning on going to Europe or Australia, where I think it hurts the most. But it is frustrating to watch the dollar continue to weaken, especially since we've pretty much brought it upon ourselves by being such a consumerist nation that we buy, buy, buy without ever considering how we are going to be able to pay for it. The war and the ever-increasing national debt certainly doesn't help either.

I think eventually the dollar will rise (though we'll never see the days again when you could buy a Euro for only 80 something cents...boy was that a good time to be living abroad), but it's going to take time. My attitude...carpe diem. No point in putting travel off, because there are no guarantees.

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Wow, that is a bold statement. Tell that to the Italians or the Argentines.

I'm not familiar enough with Argentina to comment, but the thing with Italy is that it's part of a larger currency, so it's performance is linked to Europe as a whole, not to Italy.

It's a problem with a lot of broad based currencies. The CAD is doing decently now, largely thanks to the resource economies, which is killing off Ontario's manufacturing economy.

Also, the statement may be bold, but I think over the long term, it's accurate.

What seems likely is that US debt problem will be decreased in real value through inflation. I expect the downward trend will take a long time - possibly a few years - to correct, but I stand by my prediction that the value will come back, eventually.

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What seems likely is that US debt problem will be decreased in real value through inflation. I expect the downward trend will take a long time - possibly a few years - to correct, but I stand by my prediction that the value will come back, eventually

I'm thinking maybe not, at least not to the strength it had five-ten years ago. Why? Broad and deep inflation in all parts of the US economy.

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I'm not familiar enough with Argentina to comment, but the thing with Italy is that it's part of a larger currency, so it's performance is linked to Europe as a whole, not to Italy.

I'm referring to pre-Euro times. La lira, oh la lira. It was always a good laugh for us Swiss.

I've been posting on a similar thread in the "Funding Your Travel Habit Section". So far it is talking about ways to put USD into other currencies to help out.
http://boards.bootsnall.com/eve/forums/a/tpc/f/93300904316/m/43400168416

Personally, I returned from a SEA trip last year and didn't think I got hit too hard. I plan on going to Central and South America next in a few years. Those choices are where I wanted to go and not chosen because of the dollar.